ESG Management

Responsible Investment in Asia-Pacific

KKR’s global ESG policies grant a competitive advantage for KKR today in the marketplace. Creating sustainable long-term value in companies, having the right environmental practices, the right labor practices, and the right transparency in governance are all critical elements of a successful business. September 30, 2014.

While many of the businesses we invest in face diverse sustainability challenges or opportunities, just as they face diverse operational or financial issues, some issues do span multiple sectors. When there are common issues, we see a particular opportunity to build “communities of best practice” on shared challenges and to learn from the expertise within our own portfolio.

Believing that we have a differentiated ability to help our private equity portfolio companies pursue ESG-related goals, we have created a number of proactive programs to share resources to address common challenges. Each program has internal and external partners who focus on producing results through financial, environmental, and social impact, or risk mitigation.

Green Portfolio Program

In May 2008, KKR launched the Green Portfolio Program (GPP) in partnership with the Environmental Defense Fund (EDF). The GPP is an operational improvement program that uses an “environmental lens” to assess critical business activities of KKR’s participating private equity portfolio companies.

Since the Green Portfolio Program was launched, 19 of the participating companies have reported results. As of June 30, 2014, the program has achieved more than $917 million in financial impact and avoided more than 1.8 million metric tons of GHG emissions, 4.7 million tons of waste, and 19.5 million cubic meters of water use.

Responsible Sourcing Initiative

The Responsible Sourcing Initiative (RSI) provides portfolio companies with guidance and resources focused on the continuous improvement of their management of human rights and environmental issues in global supply chains. As of today, we have worked with 26 companies in our private equity portfolio to review their procedures for sourcing practices and possible supply chain risks. Where there are areas for improvement we provide guidance and action plans.

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KKR Wellness Works

KKR Wellness Works was launched in 2011 and is built on the idea that employees who know their key health indicators are able to make better decisions for their health and ultimately improve their well-being. Our private equity portfolio companies enrolled in this program commit to offering an annual incentivized biometric screening to employees. They also provide resources for employees to better understand and respond to their results, while protecting individual privacy.

Integrity and Engagement

We encourage our private equity portfolio companies to enhance engagement with their stakeholders by educating them about the voluntary codes and frameworks of transparency. In 2011, we supported their efforts through a series of webinars on relevant topics that reached more than 22 portfolio companies around the world. In 2012, we launched a partnership with Transparency International (TI), a global anti-corruption NGO. Through this partnership, we seek to enhance our private equity investment and company management processes, specifically in business integrity. In 2013, Transparency International participated in our annual General Counsel conference presenting on best practices in anti-corruption and anti-bribery to 32 Chief Legal and Compliance Officers representing their respective companies. We also co-hosted a webinar for our global portfolio companies titled “Bribery in Business,” which provided an overview of TI’s International Business Integrity Toolkit.

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Vets @ Work

Vets @ Work is an initiative aimed at recruiting and hiring veterans across our U.S.-based private equity portfolio companies. As of September 2014, 20 of our private equity portfolio companies participate in the initiative.